PO POLC42 To Topics in Comparative Politics Af African Politics cs Week 11: Economic development in Africa
Kahoot!
Recap • Genocide in Rwanda • Paucity of interstate armed conflict in Africa • Civil conflict in Africa
Recap • Causes: • States-system • States • Neopatrimonialism and state-society relations • Politics of identity • Threat of coups d'état • Large populations • Low income • Rough terrain • War-affected neighbours • Resources • Horizontal inequalities
Recap • Variable specificity • Causal mechanisms: • Grievance • Greed • Feasibility • Commitment problems in interethnic relations and ethnic exclusion
Plan for today • Economic development: • Key aspects of postcolonial African politics • Connections with other aspects • Historical change
Development • Myrdal: • "By development I mean the movement upward of the entire social system […] This social system encloses, besides the so-called economic factors, all noneconomic factors, including all sorts of consumption by various groups of people; consumption provided collectively; educational and health facilities and levels; the distribution of power in society; and more generally economic, social, and political stratification; broadly speaking, institutions and attitudes. […] This social system may stay stagnant, or it may move upward or downward.” • Myrdal, Gunnar. 1974. "What Is Development?." Journal Of Economic Issues 8 (4): 729-730.
Economic development
Human development
Poverty
Trends over time Bloom, David E., Jeffrey D. Sachs, Paul Collier, and Christopher Udry. 1998. “Geography, Demography, and Economic Growth in Africa.” Brookings Papers on Economic Activity 1998 (2): 207–95.
Trends over time: Ghana and South Korea
Why has Africa grown slowly? • Collier and Gunning’s typology of causes: • Destiny and policy • Domestic and external
Geographic determinism • Bloom et al.: • “At the root of Africa's poverty lies its extraordinarily disadvantageous geography, which has helped to shape its societies and its interactions with the rest of the world.” • Bloom, David E., Jeffrey D. Sachs, Paul Collier, and Christopher Udry. 1998. “Geography, Demography, and Economic Growth in Africa.” Brookings Papers on Economic Activity 1998 (2): 207–95.
Geographic distribuJon of development
Geographic determinants of Africa’s lack of development according to Bloom et al. • Agriculture: • High evapotranspiration (evaporation + transpiration) + • Low and variable rainfall à • Low photosynthetic potential • Highly weathered soils • Veterinary diseases • Plant and animal pests • Human health: • Infectious diseases
Other exogenous determinants of Africa’s lack of development according to Collier and Gunning • Small economies • Resource curse • Ethnic fractionalization • Distance from markets • Low population density à barriers to trade • High population growth and low life expectancy • Late demographic transition • AIDS pandemic
AIDS pandemic in Africa • In 2010, 68% (22.9 million) of all HIV cases and 66% of all deaths (1.2 million) in Africa • 5% of Africa’s adult population infected • 60% women • Variation: • ~30% in Swaziland and Botswana • 12.4% in South Africa
Causes of the AIDS pandemic in Africa • Health systems • Migraoon to cioes • Sex work • Sogmaozaoon and discriminaoon • Cultural taboos and sex educaoon
Can destiny explain this? https://data.worldbank.org/indicator/NY.GDP.PCAP.KD.ZG?end=2018&locations=ZG&start=1961&view=chart
Broader trends • Maddison: • Faster economic growth in Africa than in East Asia in the first half of the 20 th c. • Acceleration between 1960-73 • Subsequent deterioration
Phases of economic policy in postcolonial Africa • State-led developmentalism (~1960s) • Crisis (1970s) • Structural adjustment and stagnation (1980s and early 1990s) • Globalization and ‘partnership’ (from the mid-1990s)
What were African economies like at the time of independence?
African economies at the Jme of independence • Mercantilist colonial economic policies à limited industrial capacity • Agriculture as the dominant sector • Dependence on primary commodity exports, esp. minerals and cash crops à • No economic gains from processing and vulnerability to global price volatility
Postcolonial economic policies • Modernization and the need for industrialization • Dependency / underdevelopment and the desire to counter colonial legacies • Congruence of business owner, worker, and government interests (Bates) • Import substitution industrialization (ISI): • Protectionist trade regime • State intervention in economy • Subsidization of industries and industrialization
What were the effects of ISI according to Bates?
The politics of postcolonial economic policies according to Bates • Economic policies: • ISI and increased prices of manufactured goods • Taxation of agricultural producers and the use of marketing boards and market regulation to reduce food prices • Bates’ questions: • Why should reasonable people adopt public policies that have harmful consequences for the societies they govern? • How do governments get away with it?
The politics of postcolonial economic policies according to Bates • Why should reasonable people adopt public policies that have harmful consequences for the socieoes they govern? • Congruence of business owner and worker interests • Urban base of poliocal power
The politics of postcolonial economic policies according to Bates • How do governments get away with it? • Coercion • Weak organizational capacity of smallholders • Collective vs. personal interests and creation of incentives to accept the status quo à • Redistribution and alliance formation à • Patronage • Entrenchment of private interests over time
Postcolonial policies • Policies: • ISI and urban favouritism • Expansion of public employment • Establishment of welfare programmes • Limitations on agricultural production • Funding: • Taxation • Seignorage • Primary resource exports • Loans
Failure of the postcolonial policies • Continued reliance on primary resources • Indebtedness • Political instability ( à coups)
Broader context • Global economic crisis (stagflaoon, 1973 and 1979 oil crises) • Lower primary resource prices • Interest rates increase • Debt crisis
External response to the crisis • Neoliberalism • Washington Consensus • Structural Adjustment Programs (SAPs)
Structural adjustment reforms • Reduction of deficits and inflation • Elimination of seignorage and currency devaluation • Reduction of public spending, including social expenditures and public sector employment • Removal of price controls • Privatization of state-owned banks and enterprises • Creation of market institutions • Deregulation and trade liberalization • Encouragement of foreign direct investment
Impacts of structural adjustment reforms • Accelerated inflation rates • Reduction of investment • Higher food prices • Lower employment and real wages • Lower per capita incomes • Reduction of the quality of public services • Introduction of user fees for healthcare and education services • Increased poverty rates • Poor health, including malnutrition • Particular impact on women Stewart, Frances. 1991. “The Many Faces of Adjustment.” World Development 19 (12): 1847–64.
Impacts of structural adjustment reforms: the case of Uganda • Loss of 40% of GDP between 1970-1986 • Structural adjustment reforms à • Rapid economic growth: • 6.3% between 1986-1999 • 6.9% in the 1990s • Poverty reduction: • 56% in 1992 • 31% in 2006 • Attributed to structural adjustment reforms • Collier, Paul, and Ritva Reinikka. 2001. “Reconstruction and Liberalization: An Overview.” In Ritva Reinikka and Paul Collier (eds.), Uganda’s Recovery: the Role of Farms, Firms, and Government . Washington, D.C.: 15-47. • “The most influential development model of the 1990s” • Mallaby, Sebastian. 2004. The World’s Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations . New York: Penguin Press.
Globalization and ‘partnership’ • The good governance paradigm Poverty Reduction Strategy Papers (PRSPs): • Debt relief in exchange for PRSPs • Delivery mechanisms in e.g. the US Millennium Challenge Corporation • Globalization and ‘trade, not aid’: • Bilateral investment treaties (BITs) • African Continental Free Trade Agreement (AfCFTA) (2018) • China in Africa
China in Africa https://www.youtube.com/watch?v=KGhHmYW7FMc
Kahoot!
Recent trends (and variation)
VariaJon
What explains the variation in the performance of African economies since independence?
African economies in 2019
Final exam • Two parts: • 5 short question answers • Chosen from a list of 10 questions • 50% • 1 essay • Chosen from a list of 3 questions • 50% • Description + analysis • Class + readings
Recommend
More recommend
